Derek Wachob, Chief Executive Officer of a large steel pipe manufacturer based in Sapulpa, Oklahoma, pled guilty on July 27 to orchestrating a multi-year scheme that defrauded investors, a bank, an investment firm, and at least two steel pipe distributors of at least $66 million. The plea was entered before U.S. District Judge J. Paul Oetken in the Southern District of New York.
United States Attorney for the Southern District of New York Jay Clayton said, “Derek Wachob portrayed himself as a billionaire and accomplished CEO, but the success he projected was a fiction sustained by fraud. He defrauded victims—including some of his closest friends—of more than $66 million and used their money to bankroll a lifestyle of luxury cars, vacation homes, private jets, helicopters, and yachts. In New York, we celebrate ambition, hard work, and honest achievement. These are bedrock principles that fueled the growth of our great city. Fraudsters undermine those principles and erode the trust in the fairness of our society. Today’s guilty plea sends a message that fraud will not be tolerated and ensures Wachob faces the consequences of his lies.”
According to charging documents and statements made in public filings and court proceedings, from October 2022 through August 2024 Wachob misled victims by falsely claiming to offer business opportunities based on future steel purchases he pledged to make. Instead of using funds as promised for business purposes or investments related to Company-1—the Oklahoma-based manufacturer—Wachob spent millions maintaining an extravagant lifestyle including expensive vehicles and properties while also supporting his financially struggling company.
Wachob pleaded guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison. The actual sentence will be determined by Judge Oetken at a hearing scheduled for November 17.
Clayton praised the FBI’s efforts on this case as well as assistance from the U.S. Attorney’s Office for the Northern District of Oklahoma. The prosecution is being handled by Assistant U.S. Attorneys Danielle Kudla and Adam Sowlati from the Complex Frauds and Cybercrime Unit.